The proposed studies are aimed at understanding how a single morphogen initiates the complex hierarchy of events leading to axis specification during animal development. The morphogen under investigation, Dorsal, is a transcription factor that is distributed in a dorsoventral concentration gradient in the Drosophila blastoderm embryo. This factor functions as both an activator and a repressor of transcription to establish multiple domains of gene activity along the dorsoventral axis. The diverse functions of Dorsal are mediated by a network of interactions between the Dorsal rel homology domain (RHD), the Dorsal Cterminal domain (CTD), and many additional regulatory factors. One Dorsal-interacting protein that is essential for Dorsal-mediated repression is the corepressor Groucho. The first specific aim of this proposal is to illuminate the mechanism of Dorsal-mediated activation by characterizing two sets of mutations discovered in a recent systematic mutagensis of Dorsal. These two classes of mutations define two distinct surfaces on the RHD. Affinity chromatography will be employed to identify novel coactivators that mediate the function of the surface defined by the class II mutations. Both genetic and biochemical approaches will be employed to test the hypothesis that the surface defined by the class I mutations modulates the activity of the CTD. The second specific aim is to determine the mechanism of repression by Groucho. Previous studies have led to a hypothesis for Groucho-mediated long-range repression that involves the recruitment of Groucho by Dorsal, the subsequent recruitment of a histone deacetylase by Groucho, and finally the spreading of Groucho along the deacetylated template. Genetic analysis, structural studies, and chromatin immunoprecipitation experiments will be combined to test this hypothesis rigorously. [unreadable] The pathway regulating dorsoventral patterning in Drosophila is homologous to pathways regulating the vertebrate immune response and vertebrate pattern formation. Thus, these studies may lead to a better understanding of human immunological and developmental disorders. [unreadable] [unreadable] [unreadable]